The Treaury has not been issuing much in the way of long term debt so yes, within that category, the Fed has been their significant buyer. I think the Treasury should also be moving more US debt to longer term instruments to capture lower debt costs for farther into the future.

The next big domestic buyer that comes to mind is the mutual fund community with more than $12.4 trillion in assets ($9.9 trillion in long-term funds — stocks, bonds and hybrid funds — and $2.5 trillion in money market mutual funds). The two charts below show the net purchases of Treasuries for money market mutual funds and long-term mutual funds. This data also comes from the Federal Reserve’s flow-of-funds report.

As the first chart shows, money market mutual funds were net sellers of Treasuries seven quarters in a row before returning with net purchases.

The second chart shows long-term mutual funds are net buyers of Treasuries. While these purchases have rebounded in recent quarters, neither the long-term mutual funds nor the money market funds are large players in the Treasury market when compared to foreigners or the Federal Reserve

Domestic Investors – Banks

Are banks’ holdings of Treasuries closer in scale to those of the Federal Reserve or foreigners?

The first chart below shows U.S. chartered bank holdings of Treasuries have declined from $294 billion in Q1 1994 to just $29 billion in Q1 2012. The second chart shows a long-term look at the percentage of banks’ assets invested in Treasuries. Back in the 1950s it was near 40%. Today it is less than 0.3%. Simply put, banks do not buy Treasuries.

Last edited by Zippyjuan; 11-01-2012 at 03:35 PM.

"I think we never get the candidate we exactly want unless you're the candidate." Rand Paul.

I'm definitely not an economic expert, so hopefully you can correct me if I'm wrong, but if China/the world keeps buying our debt and doesn't dump their dollars then the music keeps playing right? I think it's impossible to know how much time we have, I still think if we greatly reduced the deficit very soon we could avoid the worst of it.

There is no chance of greatly reducing the deficit. If you do not believe that, look at the Senate, how many votes can you get , to cut anything ?

And now hurricane Sandy has created jobs and tons of new wealth. Rejoice!

Originally Posted by Ron Paul

Perhaps the most important lesson from Obamacare is that while liberty is lost incrementally, it cannot be regained incrementally. The federal leviathan continues its steady growth; sometimes boldly and sometimes quietly. Obamacare is just the latest example, but make no mistake: the statists are winning. So advocates of liberty must reject incremental approaches and fight boldly for bedrock principles.

Actually, tons of new expense to be carried by state, local govt.'s , insurane co.'s to be passed to the tax payer.... net loss ...

Tons of demand has been created, and think of all the employment needed to rebuild!

Originally Posted by Ron Paul

Perhaps the most important lesson from Obamacare is that while liberty is lost incrementally, it cannot be regained incrementally. The federal leviathan continues its steady growth; sometimes boldly and sometimes quietly. Obamacare is just the latest example, but make no mistake: the statists are winning. So advocates of liberty must reject incremental approaches and fight boldly for bedrock principles.

The US Debt is past 16 Trillion, US Total Debt is 58Trillion, the unfunded Liabilities are in the nature of 250trillion, student loan debt OUTWEIGHS personal credit card debt, none of this is in a reverse trend. It's all getting much worse, and the reason that there's an illusion of prosperity is because of the massive inflation that's going on to create it.

Nothing is better, nothing is close to better, if you ride up the bubble and assume it's peaches and cream you're crazy. Whatever ride up we get temporarily will be offset in the future by an even greater crash than 2008.

Things might get better but it's an illusion. This country is flat out broke and the people are carrying the entire burden they just haven't been slammed with it yet.

The US Debt is past 16 Trillion, US Total Debt is 58Trillion, the unfunded Liabilities are in the nature of 250trillion, student loan debt OUTWEIGHS personal credit card debt, none of this is in a reverse trend. It's all getting much worse, and the reason that there's an illusion of prosperity is because of the massive inflation that's going on to create it.

Nothing is better, nothing is close to better, if you ride up the bubble and assume it's peaches and cream you're crazy. Whatever ride up we get temporarily will be offset in the future by an even greater crash than 2008.

Things might get better but it's an illusion. This country is flat out broke and the people are carrying the entire burden they just haven't been slammed with it yet.

Your unfunded liabilities number is not only off by multiples, but also an illusion. "Unfunded liabilities" is just a way to calculate future expenses without considering revenues. That's a really stupid way to look at on-going expenses.

Good to see all the negative Nancy viewpoints in this thread. I consider it a contrarian indicator - things are getting better.

In a central planned world, things can improve in your neighborhood without improving in mine. If America, and her allies, war on Iran, then Raytheon, Lockheed Martin, GE, Haliburton, and many other warring contractors will profit at the expense of private industry and the innocent people of Iran who get maimed or killed. War Is A Racket ... after all. The Hospital Industry thrives too. That is not a good thing unless you are one who profits from the maiming and killing and don't care about your fellow humans.

Sure the economy might show some minor signs of dead cat bounce, but the underline fundamentals are outright horrible. If you think printing and borrowing trillions will work in the medium to long term, you are a fool. We are sowing the seeds of our own destruction and will pay for it. Fake markets propped up to the tune of trillions by central banks will not hold. In the last 5 years, we have borrowed 5 trillion on the federal side and printed near 2 trillion dollars from the federal reserve and our economy is still barely moving. Just because people were buying stocks hand over fists in the .com bubble, doesn't mean that the cliff isn't just around the corner. I don't care how much demand there is for western bonds, because reality will return and it will not be pretty.

Sure the economy might show some minor signs of dead cat bounce, but the underline fundamentals are outright horrible. If you think printing and borrowing trillions will work in the medium to long term, you are a fool. We are sowing the seeds of our own destruction and will pay for it. Fake markets propped up to the tune of trillions by central banks will not hold. In the last 5 years, we have borrowed 5 trillion on the federal side and printed near 2 trillion dollars from the federal reserve and our economy is still barely moving. Just because people were buying stocks hand over fists in the .com bubble, doesn't mean that the cliff isn't just around the corner. I don't care how much demand there is for western bonds, because reality will return and it will not be pretty.

You have to look on the bright side. In the near future, people could be taking home weekly paychecks in the MILLIONS!